2
The Courage to Make the Change
Kip continued relating his story because he felt he had to. “My brother, who was an alcoholic, hit rock bottom in the late seventies,” he said in a matter-of-fact voice. “I remember the call from my older sister that one cold fall night. She said he’d wrapped his car around a tree. That was his wake-up call. He joined AA shortly after.
“Alcoholics Anonymous was the best thing that ever happened to him and his family. The lessons my brother learned and that I learned after my heart attack were similar. First, admit you have a problem, then accept the fact that it’s within your power to make the changes you need to make.
“Sure, you’ll need help. No one can do it all by himself. But you must take the first step.” Kip was trying to be direct but respectful with his fellow CEO.
“When I admitted to my staff that I had a problem, I gave myself choices, and that was a great gift. Believe me, Pete, you have lots of alternatives, and I don’t mean fancy programs or silver bullets.”
Pete was intrigued. In fact, he was moved. “I can pretty much guess the changes you made in your personal life, but what alternatives did you explore at work?” he asked.
“I first started exploring alternatives with the people who were most affected by my behavior,” Kip replied pointedly. “Our first attempts at change were sincere but flawed. They were flawed because I was still looking for a program. I thought if I could find the right program, our problems would disappear.18
“We tried total quality management (TQM). Remember in the mid-eighties it was the rage, and it made sense at the time. And we enrolled our people in personal improvement courses; I even took on a personal coach. I brought in consultants to help us design a new incentive program, we installed a customer service initiative, and we outsourced our help desk facilities. We tried every program we thought was reasonable. Still, we saw no real sustainable improvement to our bottom line. And our people didn’t seem to be any more accountable.”
Kip could see that Pete was engrossed in what he was saying. The last thing he wanted to do was to bore anyone with his ideas.
Pete looked at Kip and asked, “OK, so what did you finally do?”
“One afternoon as I was driving home after another frustrating day, it came to me. I was so excited about the idea that I stopped my car on the side of the road and called the one senior staff member who’d always tell me when I was off base—my retail operations vice president, Jennifer Bailey. This was before cell phones. I can recall the experience to this day. I had to speak—no, I had to shout to be heard on the pay phone by the side of the highway.
“Imagine the scene: I’m telling her about my great epiphany as I’m shouting into this phone while holding my hand over my left ear as the trucks whizzed by.” Kip chuckled as he related the story.
“What did she say?” asked Pete.
“I thought she’d laugh, but she didn’t. Jennifer Bailey, the one person I knew who would tell me flat-out if I was all wet, said, ‘What took you so long to figure it out?’ Pete, that was the beginning of my journey.
“It seemed simple standing out on that highway and talking to Jennifer, but what happened over the next several years wasn’t easy. Frankly, it turned out to be the hardest three years in my business career. But it saved me, it saved our business, and it saved my relationship with everyone I cared about.”19
Pete sensed that this man was about to tell him something important. “What was your epiphany?” he asked with anticipation.
“Pete, what I told Jennifer was simple. ‘People work better when they’re free to do it their way.’ That was my epiphany.
“Did I want my staff to live in fear that they would say or do something wrong? Or did I want them to be free to do their job as they saw fit, to the best of their abilities?
Did I want my staff to live in fear that they would say or do something wrong?
Or did I want them to be free to do their job as they saw fit, to the best of their abilities?
“The epiphany was an either/or choice. Choosing freedom would strip all of our control-based assumptions and challenge our capacity to trust our people. Choosing freedom would mean that every staff member at every level would be fully accountable for his or her ideas, actions, behaviors, and performance, without anyone looking over his or her shoulder. No more alibis, passing the buck, or playing the blame game, and no second-guessing on performance reviews. To me, it meant that I would no longer accept the ‘helpless victim’ role from my staff. And it meant for the first time we’d enjoy an adult-to-adult relationship.”
Pete began thinking about the consequences of Kip’s ideas on his business. He knew that Kip was personally challenging him to make a fundamental choice between control and freedom. That’s why Kip was telling him this story. Would he continue to choose a control-based approach to business, or would he abandon the idea of controlling others in favor of freedom? These were uncharted waters for Pete.20
Pete’s began playing out different scenarios in his mind. Could he trust his people to do their jobs? Pete realized that even thinking like this was dangerous.
Shaking his head, Pete muttered to himself, “No, it isn’t possible.” Given his present circumstances, this was the wrong time to even consider something like this. It would be nuts, and he’d be signing his own career’s death warrant.
Kip knew that abandoning control was pretty radical. He had experienced this reaction over the past years with many business leaders. He himself would have reacted the same way if some stranger had offered the freedom philosophy as a solution early in his career.
“Pete, remember what Jennifer said: ‘What took you so long?’ She had already figured out that all the programs we were trying wouldn’t solve our fundamental problem—getting people to own their jobs and to be accountable. She knew that personal coaching, measurement tools, and incentives might be helpful but that the fundamental issue still remained untouched. I guess she was a lot smarter than I was. It took me over a year after my heart attack to recognize that believing in people was the missing piece of the puzzle.
“Since I retired from National Stores, I’ve been sharing this philosophy—that you must abandon the idea of controlling people—with business leaders who have hit brick walls. I guess you could call it my mission in life.” Kip smiled and continued.
“They’ve hit this wall after decades of trying control-based programs, systems, and processes that seem always to fall short of the promised benefits. The lesson I learned from Jennifer and others was that the more you try to control people, the less responsible and accountable they become.
The more you try to control people, the less responsible and accountable they become.
“The funny thing is that business leaders will try just about every crazy idea, gimmick, or program under the sun before they’re willing to consider a freedom-based approach of trusting people and treating them like adults!21
“Jennifer recognized a fundamental truth about human nature that I didn’t—that people want to be great. And not only do they want to be great, but also they need to be great, and they need their freedom to achieve great things.
“Before my eyes were opened that afternoon, National Stores focused on facilities management, store locations, marketing and merchandising, distribution systems, inventory control, centralized purchasing, and sales training. We forgot the simplest of lessons that everyone wants to be free to choose to do it their way. And, if you let them do it their way, the possibilities are darn near infinite.”
Intrigued but still skeptical, Pete wanted to know more. “Kip, I appreciate everything you’re saying, but you said earlier that the one issue facing me was accountability, that everything came down to this one issue. So, exactly how does freedom produce accountability?”
Kip smiled and welcomed the direct question. “Pete, you’ve asked the right question.” The older man sat back in a reflective posture and raised his eyes to the ceiling of compartment 417-C. Before he spoke again, he refocused his eyes on Pete. “That’s the piece of the puzzle I didn’t see at first. But Jennifer—good ol’ Jennifer—did. Here’s what it boils down to: You cannot control people and ever expect them to be accountable. Or, put in the reverse, to create personal accountability at every level, you need to establish a freedom-based workplace at every level.”
“You’ve got to be kidding,” said Pete with astonishment. “How in heaven’s name do I do that?”
At Pete’s last declaration, Kip put his briefcase on his lap and searched through it while he talked. “Pete, here’s the easiest way I can explain how you do it.
“When I returned to the National Stores offices that next morning, I cleared my calendar and asked Jennifer and another senior team member, my merchandising director, Brad Copler, to help me put together our transition plan.”
You cannot control people and ever expect them to be accountable. Or, put in the reverse, to create personal accountability at every level, you need to establish a freedom-based workplace at every level.22
Pete interrupted, “A transition plan?”
“OK, what I mean is that I realized that if we were going to abandon control-based thinking, we’d better know as much as we could about what old strategies we needed to abandon and what new strategies we were going to embrace. Ah, here it is,” Kip exclaimed as he pulled a paper from his briefcase.
Without missing a beat, he continued. “I called it our transition plan. Jennifer and Brad helped me focus on this new approach and thinking. Eventually, I hoped everyone would know what we were talking about, where this was taking us as a company, and what changes and new commitments we needed to make.”
“I see,” said Pete, with some admiration. “It makes sense.”
Kip went on while he handed the paper he’d found to Pete. “That day, we crafted this ‘T-chart’ because it was the most straightforward way to explain where we were and where we were going or, put another way, what we were abandoning and what we were embracing.”
Pete looked at the chart while Kip spoke. “We organized the left side by the systems or processes that we presently had in place, the program and tools that controlled us. We ultimately abandoned everything on the left side of the chart, all three strategies. Not right away, mind you, but over a course of three to four years.” Kip first detailed the left side of the T-chart—the control-based approach.
“We had worked on our structures for years. So, we identified the very first control-based element—’Impose Authority.’ Our hierarchy was defined by our organizational chart. Next, we looked at how we approached supervision. We also identified a more subtle form of imposed authority that might surprise you. It was our quota systems.
“We concluded that quotas were a more subtle form of imposed authority, and, oh boy, were they prevalent at National Stores! Brad, Jennifer, and I really challenged each other on this one. In the end, they convinced me that quotas had to go if we were to stop imposing authority on our people.
“The fourth element under ‘Impose Authority’ were all the ‘Policies and Procedures,’ and I didn’t need much convincing on this one.” Kip smiled as he completed his explanation of the first category.
As Kip wrote out the first series of elements on a blank piece of paper, Pete quietly read them over and said nothing. Kip had ticked off the elements like he was reading a list of things you’d take on a camping trip, but Pete knew that each element had its own power base and momentum, along with a survival instinct deadlier than a cornered rattlesnake.
Kip’s momentum, like the train’s, was now unstoppable. Pete stared intently at the T-chart. He could not imagine throwing out all of the processes and systems that he and his fellow executives had labored so intensively to set in place. It seemed unfathomable that the older man was actually proposing that he abandon what was universally accepted—at least in the United States and most Western business environments—as the sound way to run a business enterprise.
Was he hearing Kip correctly? Could such a concept work? He wasn’t sure, but he knew he had to hear more.